“Hi Gary, we’re going to be calling you shortly to sell our home soon. Right now my wife and I have a question. If we sell and the buyer backs out, do we get to keep the deposit? I say yes, but my wife says it depends.”
Answer:
Listen to your wife!
The standard purchase contract has certain normal contingencies for loan, inspections, review of disclosures and various documents, etc. If a buyer exercises those rights within the allowed time limits and cancels, you must give him his deposit back.
And even if he flat-out breaks the contract, it’s far from automatic who gets the money. It’s because the deposit is typically held by the escrow company, a neutral 3rd party who can’t release money to you or your buyer without mutual instructions or a court or arbitration order.
